May 14, 2014
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by Elizabeth Weise, USATODAY

by Elizabeth Weise, USATODAY

SAN FRANCISCO - A meeting on Thursday in Washington D.C. could determine how much wireless costs and how well and how fast it works.

The open meeting by the Federal Communications Commission will consider proposals for rules governing an "incentive auction" of airwave spectrum set to take place next year.

The basic idea is simple. The FCC wants TV stations to sell it back licenses to low band spectrum they don't use.

Those low bandwidths are the most valuable to wireless carriers, because those wavelengths can go long distances and reach deep into buildings, meaning fewer dead spots for cell phones.

The FCC will then take those bits of spectrum and repack them into useable swaths that can be auctioned off so carriers in the booming wireless market can expand their service.

The devil is in the details. One topic for Thursday's meeting is who gets to bid and how much they can bid for.

In April, FCC chair Tom Wheeler proposed a plan that, in some areas, would reserve some of the newly-available spectrum real estate for smaller wireless carriers.

Currently AT&T and Verizon Communications are the nation's largest mobile carriers.

Writing in his blog three weeks ago, Wheeler said "this disparity makes it difficult for rural consumers to have access to the competition and choice that would be available if more wireless competitors also had access to low-band spectrum."

The biggest winners would be Sprint and T-Mobile, the nation's next two largest carriers.

Some Republicans say the bidding shouldn't be controlled.

In a letter to Wheeler on May 2, all 16 members Republicans on the House Energy and Commerce Subcommittee on Communications and Technology said restricting the largest carriers from bidding on some spectrum was an artificial attempt to manipulate the market.

"The FCC must not be in the business of picking winners and losers," they wrote.

However on May 9, Democrats on the House Energy and Commerce Committee wrote to Wheeler saying his plan would protect competition in the wireless market.

There are also larger questions, such as whether broadcasters sell in sufficient numbers to get a crucial mass of spectrum, said Philip Weiser, dean of the University of Colorado Law School in Boulder and an expert on telecommunications law.

The auction will also be the most complex the FCC has ever undertaken, requiring it to design a two-side auction.

The government will be the broker, figuring out which TV stations want to sell spectrum and at what price, repacking the spectrum and then determining which wireless companies want to buy it and how much they'll pay.

No one knows whether it will work.

"We won't know until it actually happens," said Weiser. "It could be a fabulous accomplishment that other countries could look at it as a model or it could be a double bank shot that doesn't go in."